Two main Goals Be able to prepare proposal budget using the ORSO - - PDF document

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Presented by:

Budgeting for Sponsored Projects

Matt Michener Grant and Contract Coordinator Lead Office of Research Support and Operations Jami Capps Director of Finance International Programs Kim Akin Fiscal Analyst Sponsored Programs Services

Updated October 2018

Two main Goals

• Be able to prepare proposal budget using the ORSO

recommended budget template

• Understand background behind proposal budget

preparation for Sponsored Projects, including federal, sate and university guidelines and/or regulations

What are Sponsored Projects?

• University projects funded or ‘sponsored’ by an
• utside agency
• Projects designed to accomplish a public good

versus furthering a commercial gain

• Examples of ‘sponsors’: Federal and state

governments, foundations and private industry

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• Request for Proposal (RFP) or Guidelines for preparing

the application and budget

• OMB Circulars/ Uniform Guidelines (UG)
• ORSO Guideline 2 and University regulations
• Cost accounting standards
• Direct Costs (DC)
• Facilities & Administrative Costs (F&A, IDC)
• ORSO Budget Template

What you need to know to create a Budget for grant proposals

• Broad Categories: Personnel,

Supplies, Travel, Indirect Costs

• Detailed: Itemize each individual

component of the budget

• Modular: Total request for direct

costs and indirect costs Types of Budgets and Budget Justifications

Where to begin?

• Be familiar with the rules and regulations and

where to find them

• Review the Request for Proposal (RFP)

–Determine if there are funding limits –Determine if F&A is allowable and what rate –Determine if there are unallowable items

• Determine broad budget categories and
• verall project goals

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Where to begin?

• Work with the Principal Investigator (PI)

–Identify what personnel will be working on the project –Is travel necessary

• Is it allowable by the agency
• Is it foreign or domestic

–Determine if equipment and supplies are necessary and allowable for the project –Are there subcontracts

• Will funding meet subcontractors needs for their portion of

project

Where to begin?

• How do I know if costs are allowable?

–Would they be considered REASONABLE by a financially prudent person –Are the costs ALLOCABLE: beneficial to both parties and advance the work under the sponsored project –Are the costs TREATED CONSISTENTLY: are estimates for like items similar, are they normally treated as direct or indirect costs –Are the costs ACCEPTABLE to funding agency: RFP and Agency guidelines will dictate this. READ THEM CAREFULLY *Make sure budget allows for enough funds to cover all expenses, but do not Pad the budget

Understand the typical budget categories

• Salaries (00)
• Wages (01)
• Benefits (07)
• Goods & Services (03)
• Travel (04)
• Capital Equipment (06)
• Stipends, Fellowships, Participant Support Costs (08)
• Subcontracts (sub-account created at account set up) (14)
• Facilities & Administrative Costs – F&A (13)

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Salaries, and wages

• Who can be paid on a grant

– Principal Investigators (PI and CO-PI’S) – Professional Associates – Graduate Research Associates – Time Slip Employees * Administrative Staff are not typically allowed to be paid on a grant UNLESS they work for a Major Project or deemed allowable under the RFP. Page 5 of the Guideline 2 addresses this in more detail, also see CFR 200.413.

Benefits (Plus QTR & Health for students)

• Annual Benefits Calculations by Employee Type, given that FTE >= 0.50

(OASI%+Medcr%+Retrmt%+Unempl%)*Salary) + (Med Aid $* FTE*Term) + (Health Ins. rate x 12) Classified Benefits = (0.191 x Salary) + (36.31 x FTE x Term) + 10080 Exempt Benefits = (0.1653 x Salary) + (36.31 x FTE x Term) + 10080 Faculty Benefits = (0.1653 x Salary) + (36.31 x FTE x Term) + 10080 Graduate Benefits = -0- + (36.31 x FTE x Term) + 1908 (+ 10890 if QTR)

• Estimated Benefit Percentages by Employee Type

FY 14 FY 15 FY 16 Civil Service 42.5% 38.7% 46.2% Bargaining Units 41.1% 39.4% 47.1% Exempt 33.2% 29.4% 33.2% Faculty 28.6% 26.2% 28.7% Weighted Average CS/BU/EX/FAC 34.4% 31.5% 36.1%

*This information can be found in the ORSO budget workbook and the WSU Benefits website

Benefits (Plus QTR & Health for students)

Grad-student salaries will Vary from college to college. Please make sure you use the correct step for your grad as well as your area

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Benefits (Plus QTR & Health for students)

QTR will vary from college to college, please make sure you are using the correct matrix for your area

Calculating salaries and benefits

• Salaries inflated 4%

each July 1

• QTR inflated 7% per

year (until further notice)

• Health insurance

inflated 4% per year

• It is suggested that all
• ther costs (examples:

Goods and Service, Consultant fees, etc.) be inflated at 4% per year http://www.ogrd.wsu.edu /guidelines.asp

Goods and Services

• Only goods and services that directly relate to the

project

• Remember that it needs to be reasonable, allocable,

consistent and acceptable to the agency

• Avoid ‘suspicious’ items such as:

–General Office Supplies –Lunch for lab meeting –Gifts * This is the area to budget for research/survey incentives

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Goods and Services

• How do I know if I am estimating costs in a

reasonable, allocable, consistent manner

–Internet searches ‘Google it!’ –Vendor catalogs –Service center price lists –Colleagues, collaborators and others with experience developing budgets

Travel

–Only charge for travel that is directly related to the project –Must be reasonable, allocable, consistent and acceptable by the agency –First/Business class is usually prohibited –Must follow the ‘Fly America’ Act

• Required by all federal agencies regardless of cost

–Whenever possible use state or federal government contract rates for airfare, hotels, auto rentals, etc.

What costs are included in travel?

• Mileage reimbursement for personal vehicle
• Per Diem
• Air Fare
• Hotel
• Rental Car Cost
• Fuel charges maybe included for rental car only

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Travel Resources

• WSU BPPM/WSU Travel Website for domestic & foreign per

diem rates, mileage rates, etc. http://www.wsu.edu/travel/ http://www.gsa.gov

• Internet sites (such as http://www.kayak.com/ or

http://www.tripadvisor.com/ )

• Travel agencies

Use state or federal government rates for hotels, airfare, and auto rental whenever possible

What is Capital Equipment?

• Any one piece of equipment which initial cost is $5,000 or greater
• Fabricated equipment which all parts and pieces equal over $5,000 (check with department

equipment coordinator to determine if fabricated equipment meets requirements for capital outlay >5K)

• Has a life span of at least one year
• Identity does not change with use
• These items need tracked and inventoried
• See ORSO Guideline 2, BPPM 40.12 and

BPPM 20.50 for reference

• The new uniform guidance (UG) will ask for screen shots or documentation for three

venders on all items over $3K. At this time it does not appear to effect budgeting practices.

CFR 200.306: Cost sharing or matching

• 1. Under Federal research proposals, voluntary committed cost

sharing is not expected;

• 2. Unrecovered indirect costs, including indirect costs on cost sharing
• r matching may be included as part of cost sharing or matching
• nly with the prior approval of the Federal awarding agency;
• 3. Values for non-Federal entity contributions of services and property

must be established in accordance with the cost principles.

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CFR 200.306: Cost sharing or matching

Cost Sharing or Matching (portion of project or program costs not borne by the Federal Government) must be:

• 1. Are verifiable from the non-Federal entity's records;
• 2. Are necessary and reasonable for accomplishment of project or

program objectives;

• 3. Determined to be Necessary and Reasonable;
• 4. Are allowable;
• 5. Are not paid by the Federal Government under another Federal

award, except where the Federal statute authorizing a program specifically provides that Federal funds made available for such program can be applied to matching or cost sharing requirements

• f other Federal programs;
• 6. Are provided for in the approved budget when required by the

Federal awarding agency;

• 7. Conform to other provisions of this part, as applicable.

Accounting for Facilities and Administrative Costs (F&A)

• A percentage of direct costs, that are real costs indirectly associated

with doing research, but not specific to any one research project.

• Determining whether project will be facilitated ON or OFF Campus.
• Exceptions to using the Federally Negotiated rates.
• Noting F&A percentage at the bottom of your summary budget with

consideration to MTDC (B40) or TDC (B02).

• Sps.wsu.edu > F&A Documents > F&A Rate Agreement

F&A Calculations Continued

• Total costs [TC or total award (TA)] : F&A is calculated on the sum of

total direct costs and F&A altogether.

• How to convert TC to TDC: TDC = TC / (1- TC)
• TC rate is 30%: .30/.70 = 42.857%
• TC rate is 10%: .10/.90 = 11.11%

– $150,000 awarded, what are directs and indirect at 15%TC? –

• .15/.85 = 17.647% for TDC

–

• 150,000 / 1.17647 = $127,500 - 127,500*.17647 = 22,500

–

• Check it: 150,000*.15 = 22,500
• Keeping F&A in mind for your subcontracts.
• We have to calculate F&A on the first $25K of the subcontract. If our prime

agreement allows for F&A on direct charges.

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Subcontract Budgeting

• A collaborative agreement where there are substantive programmatic efforts

and may include publication rights.

• A line item in your prime budget should include a subcontract allocation

(restricted object 14).

• Make sure all the appropriate materials are submitted to ORSO:

– Scope of work; – Budget, including their appropriate institutional F&A rate; – Letter of Support or Intent.

• Term date for subcontractor is prior to prime term date.
• Distinguishing between a subcontract and a consultant.
• Consultant - Specific needs of the SOW that cannot be completed by personnel within

the institution, IF allowable by the agency/organization’s RFP

• Subcontract - A collaborative arrangement in support of a research project in which

some portion of the programmatic activity is carried out through a formalized agreement between the grantee and one or more other organizations.

• Must be appropriate for the project and scope of work, in collaboration or cooperation

with a peer at another organization/institution/agency

Consultants (Personal Services) vs. Subcontracts:

• ORSO: https://orso.wsu.edu/
• SPS: http://sps.wsu.edu/
• Guidelines: https://orso.wsu.edu/wsu-policies-guidelines/
• F&A Documents: http://sps.wsu.edu/FandA.html
• Benefits Models: http://budget.wsu.edu/budget-policies/
• ORSO Quickguide/FAQs: https://orso.wsu.edu/frequently-

required-information/

Useful links:

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